Ford Motor Co. (F) leads companies selling $4.78 billion in asset-backed offerings as issuance revives following a pullback amid concern that the Federal Reserve was poised to start winding down stimulus efforts.
The automaker is marketing $1.34 billion of bonds linked to auto loans through its finance unit, according to a person with knowledge of the transaction who asked not to be identified because terms aren’t public. The offering may be sold as soon as tomorrow, the person said.
The pace of new asset-backed securities deals is accelerating as Fed Chairman Ben S. Bernanke seeks to calm markets roiled by the specter of the central bank paring its $85 billion in monthly bond purchases. Companies sold about $5 billion in bonds linked to everything from auto loans to timeshare payments last week, breaking a two-week drought, according to Bank of America Corp. analysts.
The issues “provided much needed clarity to ABS pricing levels,” the analysts led by Theresa O’Neill in New York said in a July 19 report.
Ford is marketing top-ranked bonds maturing in 2.25 years to pay as much as 29 basis points more than the benchmark swap rate, the people said. The Dearborn, Michigan-based automaker sold similar debt to yield 16 basis points more than swaps on May 14, according to data compiled by Bloomberg.
Other companies selling the debt this week include American Express Co. (AXP), Daimler AG (DAI)’s Mercedes-Benz unit, General Electric Co. (GE) and Nissan Motor Co., people with knowledge of the sales said.
Daimler is issuing $975 million of notes linked to auto loans, while Nissan’s finance unit plans a $1 billion sale of similar debt. General Electric is marketing $508 million of bonds tied to equipment loans.
American Express today sold $1 billion in bonds tied to credit-card payments, the New York-based company’s first deal this year, Bloomberg data show. The sale was increased from $526 million. The lender paid 42 basis points more than the one-month London interbank offered rate to issue top-ranked bonds maturing in five years, Bloomberg data show.
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